SEOUL, March 17 Hyundai Motor Co
said on Monday the fuel economy of its revamped Sonata sedan was
less than it had previously stated, an error that could further
undermine the South Korean automaker's reliability after a slew
of mileage-related lawsuits.
Unveiling the redesigned model to the media earlier this
month, Hyundai told reporters the sedan's fuel economy had
climbed 6 percent to 12.6 kilometers per liter from its
Hyundai, however, said on Monday that figure was erroneous
and had been based on tests at its research center. Government
tests showed the mileage had actually inched up just 2 percent
to 12.1 kilometers (7.5 miles) per liter.
"We are very sorry for causing confusion to reporters,"
Hyundai said in a statement.
Analysts said the impact of the error was likely to be
short-lived as Hyundai had announced the cut before the new
Sonata went on sale. The company said pre-orders of the model
had topped 10,000 vehicles in four days in South Korea, the
second-highest number on record.
"This may have a short-term impact on its reputation. But
for the longer term, it is better for Hyundai to take quick
action before controversy erupts," said Cho Chul, a senior
researcher at the government-run Korea Institute for Industrial
Economics & Trade.
Hyundai, and affiliate Kia Motors, are trying to
rebuild their reputations after a string of recalls and customer
lawsuits claiming that the South Korean duo overstated the fuel
economies of their vehicles in South Korea and the United
South Korean courts dismissed some claims, but government
authorities were investigating others. Hyundai and Kia settled
lawsuits in North America for a total of $395 million after
admitting in 2012 that they overstated mileage on more than 1
million vehicles there.
The latest versions of Hyundai's Genesis as well as Kia's
Soul compact are all heavier than their predecessors, which
makes them less fuel efficient, the companies said.
Hyundai, the world's fifth-largest car maker with its Kia
affiliate, is banking on the first restyling of the Sonata since
2009 to help reverse slowing revenue growth as it suffers
falling market share at home and in the United States, its
second-biggest market after China.
The Sonata is Hyundai's second top seller after its Elantra
model in the United States.
Hyundai shares ended up 2.2 percent at 234,000 Korean won
($220) each before the announcement on Monday.
Hyundai shares have performed poorly since the new Sonata
disappointed investors and as worries about the slowing growth
of China's economy increased, analysts said.
Hyundai is expected to launch the new Sonata on March 24 in
Korea, followed by the United States and other markets.